#CoolGigCompanies

The gig economy narrative is one filled with interesting people pursuing the professional careers and/or lifestyle decisions that they choose. I look forward to sharing stories as I receive them. Here are just a few:

Many people do not appreciate just how diverse the Gig economy is. Not only are there a vast number of talented people with diverse expertise from animators to data scientists to web developers, there is a growing set of companies that serve these populations in interesting ways. #CoolGigCompanies is my way to showcase some of these enterprises.

Justin Gignac spent ten years as a successful art director with major advertising firms including Ogilvy and Mather, Fallon New York and Toy. He left to become a freelancer for several reasons, one in particular that many people don’t appreciate. He wanted to make more money. He also had personal art projects he wanted to pursue and he was about to be married, which taken together with the improved income potential made for an easy decision.

Like many skilled freelancers, he had a feast or famine problem. When he was busy with gigs he wasn’t marketing so there would be dead time between projects. So he built his social media brand to reach out to clients with a Facebook page, twitter feed and a personal app. Overtime that yielded more business, but some of it would be when he was busy on other projects. So, being a creative guy, he developed a neon vacancy sign for all of his points of contact. It would read, Justin is available, Justin will be available soon or Justin is working. Eventually, those recruiting him would ask him for referrals when he was unavailable. He connected with another former colleague, Adam Tompkins, who was in the same boat, and they decided to create a unique platform for creatives.

In 2012 they launched Working Not Working, a play on the trusty vacancy sign. Given their years in the business they had a solid network of strong creative talent. Initially they focused primarily in the advertising world, assembling a cadre of art directors, copywriters, creative directors, designers and other producers. Over time they have branched out to include developers, photographers and animators. The common attribute of their membership is that all have a portfolio of work. And when you browse through the network of talent, you know their real time availability, so you need not focus on someone who is already working on a gig.

Working Not Working does not accept everyone into its network. Indeed, only 10% of applicants make it in. The firm has a unique vetting structure; it started with the management team vetting the members, but then recognized that the creative talent in the network was really the best screen. Over 200 of the best creatives on the platform vet the new talent that applies. Those who pass that screen are able to be “Members”, those who don’t can still reapply; they can submit additional work to be considered and can become members once the jury of their peers deems that their portfolio meets the high standard set for members.

The pricing for the service is also atypical. Unlike most platforms and traditional intermediaries, both of whom charge a percentage of the engagement revenue, Working Not Working charges a flat fee per client. Gignac explained that the platform was built for friends to find work. As such, they did not want to take a portion of their friend’s income. Some intermediaries tack on 30%, which makes the gig more costly and could make clients reluctant to hire. By making it a flat fee for the client, regardless of how many creatives they engage, Working Not Working encourages its client to hire as many people as they want; clients do not get in the mind set of “how much is Working Not Working making on this project and how can I get them to reduce their fees so it does not cost so much…” As the website says, it’s about “community not commissions”. That said, as they work with more and more big companies, like Google and Apple, where they can have many clients in one division, they have stayed true to their formula, but added an enterprise level pricing model.

Having developed this for friends also has some other implications. Working Not Working seeks to improve the freelance experience for its members. One very acute problem for many creative freelancers is the feeling of isolation. To combat this, the firm has events to bring people together. Their members were very grateful, which as Gignac said, “It is easy to underestimate the loneliness of being a freelancer.”

A related issue for many is rejection. Especially in the creative space, subjective considerations can lead to more rejections; a skilled illustrator could be masterful, yet her technique may not be to the liking of the client, so she does not get the gig. Knowing this, the Working Not Working team set up a podcast, Overshare, for its members where it discussed these issues. Overshare, which you can find on iTunes offers “Honest conversations with our favorite creatives about the tough stuff we don’t talk about in public often enough. “It was so well received that they decided to hold an in-person meeting to let members share their thoughts. The meeting was over-subscribed by a factor of 4. The more they can support the tremendous talent in their network, the better off they will be, the founders believe.

Working Not Working has high hopes for the future. There are many expansion options, from new geographies to new creative disciplines. In term of the latter, they won’t stray from the notion that their members have a portfolio of work. The major concern is not expanding fast enough, especially since there are other competitors in the field. However, given their special sauce of being a true ally of the creative community not just in finding gigs but in building a flourishing career despite all the emotional highs and lows that can bring, should serve the young firm well going forward. As they say on their site, “If Working Not Working creatives aren’t working for you, they are probably working against you.”

Management consulting is often a great training ground for entrepreneurs. That was certainly the case for Jan Schaechtele and Christoph Hardt, two former McKinsey consultants who were somewhat frustrated with the traditional corporate model of consulting delivered by the big firms. In search of greater transparency and a more cost effective approach, they developed a curated marketplace for consulting skills and called it Comatch. It is a European gig economy player focused on the upper echelon of the independent talent marketplace.

Comatch, which was founded in Berlin in 2014 was unlike any other enterprise in Europe at that time. There were digital talent platforms for technical resources and IT, “but there was nothing comparable for strategic consulting”, Jan explained to me recently. Since this was the same observation that led me to found M Squared Consulting based on my Booz Allen experience 25 years ago, I totally endorsed the model.

On the supply side, the firm has over 2700 consultants in its network, which represents about 50% of those who apply. Comatch needs to be strict about who can participate in order to ensure the quality of the work. They interview every consultant personally as part of their vetting process. Half of their network are former consultants from large firms, just like the founders. Their website lists the pedigrees of its network, with the top three being alumni from McKinsey (165), Accenture (122) and PWC (116).

For clients, the firm provides more than just the self-service model of many digital talent platforms. The firm works with the client to develop the project specification. It then uses a sophisticated algorithm to identify the best consultants to submit a proposal. The Comatch team selects the best proposals for the client and then presents those consultants for the project. Comatch believes this curation of the best talent with the requisite skills to perform the work is part of the “special sauce” that differentiates Comatch.

Another key factor is the relationship they build with their consultants. The consulting side of the equation is tough, since getting enough great consultants to fill the needs of clients is a challenge. To overcome it, becoming the platform of choice for the talent is critical. It starts with the in-person interview, since that creates a human connection with each consultant. Comatch has had socials and cocktail parties in multiple cities to further build a sense of community. Many if not most of their network are accomplished experts on particular topics, so they start to enable training sessions done for consultants by consultants. Since Comatch has some collective purchasing power, they use that to secure discounts for their network members on travel, productivity tools and administrative services.

Another interesting distinguishing feature of Comatch is that they also wholesale talent to the consulting industry; they have many consulting firm clients who often need reinforcements to staff their bench. Comatch affords a very efficient resourcing strategy for these industry players, since 48% of the consultants on their platform have that big firm experience. As a testimonial on their website from CMX Consulting says, ‘“Thanks to Comatch, we can supplement our team at any time with top consultants of various levels quickly, fairly and reliably. The curated approach works: there is always a fitting candidate, always at top performance. We could not have pitched or conducted some projects without COMATCH.”

This type of talent strategy represents a relatively new way to think about leveraging the gig economy talent marketplace. Jan believes that tapping the freelance movement is only going to become more important in the future of work. As companies have made their operations more standardized they have created more project based initiatives, using independent expertise to get the work done makes the most sense.

Many other people appear to share that view, which can be seen by the amount of venture capital money that is being attracted to the sector. Expert360 in Australia recently raised $10mil for its consultant marketplace. Catalant in the US raised another $41million which brings its 5 round total to $75.5 million.

Last year, Comatch raised 4 Mill euro. Jan is not so concerned about his well-funded competitors in other parts of the globe, because he believes it is a continental business. Although there are more players entering the market, when the dust settles, he thinks each continent will have 1-3 competitors in this space. Jan fully intends to be leading in Europe. Indeed, they have expanded beyond Germany and operate in Benelux, Scandinavia and recently also in France. They were the first firm to open an office in Dubai last year, a jurisdiction that presents unique regulatory challenges. Stay tuned as Comatch continues to expand its marketplace footprint in Europe in its quest to become the premier consulting marketplace on the continent.

As I continue my exploration of the wonderful world of the Gig Economy, I am discovering many fascinating firms. My #CoolGigCompanies posts will profile what some of these firms are doing and the “special sauce” that they bring to the Gig Economy. Enjoy and please leave a comment if you want to add an observation or insight.

Andrew Barr is sitting on the other side of the table now, and he likes the view. After several years as a venture capitalist at Institutional Venture Partners (IVP), a firm focused on late stage private equity investments, Barr is now a co-founder at Prefer.com, recently funded by Benchmark Capital.

At IVP, Barr was exposed to the frenetic activity going on in the digital world. He was involved in IVP’s investment in Care.com, a company he still admires. The firm got many things right, he believes, in part because they were finding in most cases a long term caregiver for clients. Due to the long term nature, they could afford to give appropriate attention to the vetting process and building relationships with both candidates and clients.

However, many digital talent platforms on the scene today are not like that. Barr saw the commoditization of low skilled work through the advent of talent apps as a force which dehumanized the process of securing services. This approach could be appropriate for delivery folks and drivers, but personal services, like massage therapists, personal trainers and house sitters needed a different model.

As Co-founder, Scott Belsky, said in a recent CNN interview, they wanted to build “a big network of small world connections.” And with that idea, Prefer.com was launched.

Prefer.com, now available only in NYC, is a cross between Yelp, Handy and Next Door. The idea is that most people have trusted professionals, from dog walkers to personal trainers to painters, that they would be more than happy to recommend to a friend. The Prefer app allows you to do just that. If your friends opt in to the app, they can get your recommendations and you can get theirs. It is a much more private system than a digital platform, since you are only getting or receiving recommendations from trusted friends. “You find the people you need through people you already know”, says Barr.

This attribute cuts both ways. A recent Fast Company article about Prefer cited the case of a masseuse who was getting referrals through a different source. Some customers were expecting more than a massage, which was not her intention, so the masseuse had to limit her referrals to just the recommendations of existing clients. Prefer allows her to do that in a more effective way.

It is because of this, that Barr believes the Prefer model is a structure that empowers independent service professionals. The Prefer model honors the entrepreneurial aspirations of the service professionals who use it, both in spirit and economically. On platforms like Handy, workers are introduced to potential clients, but at a price; these apps take between 20 and 30 percent of the total fee paid for the service. For some trades people, that seemed much too high. It can be difficult to build a career or a business on that, Barr points out.

Prefer charges only a referral fee if work is secured, and that fee is less than 5% or about ten times less on average than the talent marketplaces. The intent with Prefer is to enable the professionals to build new relationships with the contacts of their existing clients. In that way they can build a business and a livelihood, and that is a key value underlying the model.

The site launched in May with 600 active professionals and 1800 customers, according to Fast Company. Even though the company has offices in both San Francisco and New York City, New York seemed the right place to launch. San Francisco was deemed, in a way, too tech savvy to run a test program. People in the Bay Area are used to having apps for everything, so the trial process may not have been representative of other jurisdictions. Additionally, there is the sheer density of New York; it is the biggest market for demand and supply in the country, so if they can build the customer base and perfect it there, expansion is assured.

The competition, Barr notes, is not the various talents marketplaces like Angie’s List or Handy, since Prefer is not in the commodity matching business. Despite its inclusive nature, the Next Door program, where neighbors can recommend trades people is not a competitor either, since that recommendations section is just an adjunct service, not a primary one. Yelp too is not of concern, since most of these individual professional service providers do not have yelp profiles. Additionally, yelp is all about aggregating ratings from a lot of anonymous users. Scores of people you don’t know are telling you someone is 4 stars or 5 stars, which may be meaningful for an algorithm. Prefer is about an actual, personal recommendation from a friend. The real competitor is “people like you and me, texting our friends when we need a recommendation.”

Well, if you live in New York, there is no need to do that anymore. Just check out Prefer.com.

And please look for my new book, Thriving in the Gig Economy, for pre-sale on Amazon.com now. You can order it here.

I have many stories from Uber drivers, since I like to engage them whenever I get in an uber. I like to know why they drive, how often they work, do they operate with multiple companies, do they want to be an employee, do they have other gigs as well etc. The repartee helps pass the time but also keeps me current on what is going on in that driving segment of the gig economy.

I only wish I had written them all down.

One of my favorites was a fellow, I will call John. I took a ride with him in January in the evening, so it was dark, but I would peg him as in his early 30s. It was a Sunday night and he was driving because his “work was done” and he had had a good day. I innocently asked, “SO, you work on Sunday? What do you do?” His answer was, “I play fantasy football.”

In the ensuing discussion, he must have said at least three times that he makes a six figure income playing fantasy football. To be good at it though, you need to know all the players, study the injury reports and truly do your homework each week. As such, it is a very solitary pursuit. Driving for Uber is the way for him to get some social time. Thank goodness, he had a chatty customer like me.

He liked the freedom to work whenever he wanted, like at the end of a busy day watching football. He grimaced at the notion of being an employee. “Been there, done that, got the t-shirt.” he replied. And then, of course, he had to tell me yet again, how much money he makes…